8-Hour Analysis:
Big Picture: Bitcoin’s retest of the EMA band failed, resulting in yet another sell-off. Previous reports mentioned such a scenario, implying that if a rejection occurs, a new intraday sell-off might occur. Following the sell-off, price challenged the lower intra-day supports, resulting in a rapid rebound and the formation of a hammer candlestick pattern at important levels for the time being. Moving forward, price may re-test the EMA levels, with a similar outcome expected. Acceptance over 28,350 leads to continued recovery, whilst failure maintains the price under pressure for the time being.
On the Upside the former support levels have now become resistances. The session’s first wave of resistance is at 26,940, followed by 27,125 levels. Surpassing this range permits price to return towards the currently important prevailing resistance area of 27,250 to 27,330. This zone has the major EMAs of 200 and 250, as well as certain horizontal levels. A clear foothold above these EMA’s is still required for bulls to continue their upside.
On the Downside Bitcoin has a strong support presence between the levels of 26,600 and 26,500. These levels were challenged in the later hours of the session, and as expected, they halted selling and successfully reversed it with some rebound. The hammer candlestick had good volume, indicating a strong purchasing activity in this range. If sellers attempt to overrun this level, they will face a similar strong reaction from the next support at 26,200.
